Thursday, August 4, 2011

Gamification and the SVPMA


July, 2011 Report from the Silicon Valley Product Management Association


At the July 6, 2011 meeting of the Silicon Valley Product Management Association meeting held at Tech Mart in Santa Clara, Rajat Paharia presented “Gamification: why it’s important and what it means for your product.” 



Gamification is an emerging trend that is influencing product design and marketing programs. If you haven’t heard about it yet, and you are in product marketing or product management, you will. Simply, gamification is adding elements of game mechanics into marketing programs and actual products to more deeply engage the user. These principles are becoming ubiquitously applied to everything from physical therapy, to social sites such as Foursquare, numerous loyalty programs, and user training by Microsoft. Nissan even developed an in-dashboard game to motivate fuel efficient driving behavior, and Atlassian Greenhopper employs it in new-user product training.


Rajat Paharia is the founder and Chief Product Officer of Bunchball. Rajat’s skill set combines a unique understanding of technology and design that stems from a four year career at design firm IDEO where he was co-director of the Software Experiences Practice. While there, he worked with clients including ATT Wireless, Avaya, Microsoft, McDonald’s, HP and Philips. Prior to IDEO, Rajat worked at Philips Consumer Electronics, IBM Research and ViewStar. He has a Masters degree in Computer Science from Stanford University, with a focus on Human Computer Interaction, and an undergraduate degree from the University of California Berkeley.

Rajat started in gamification back in 2007. Before Bunchball, he spent several years at a design firm called IDEO where one of his favorite quotes was 'Innovation = Invention + Opportunity'. So in 2007, after having spent 2 years as a social gaming company, Bunchball realized the power of game mechanics “(the Invention) and decided to attack the Opportunity to (a) take game mechanics out of the gaming world and (b) provide them as a web service that anyone could integrate quickly and easily." 



Rajat presented many examples and case studies of companies that have incorporated various aspects of gamification techniques into their customer facing strategies and the thinking as well as the process involved to arrive at successful implementation.  He identified media companies like USA Network, community sites like MySpace, B2B publishers like UBM TechWeb and product brands like Chiquita which have all jumped on the bandwagon to utilize “gamification” to drive participation, engagement and loyalty starting in 2010. However, his company, Bunchball, was revved and selling gaming solutions for several years before the big brands were ready. He spoke about the difficulty of being ahead of the market in recognizing the value of solutions before the market is ready to engage in the conversation.

Bunchball started as a social gaming site to give people something to do.  They pivoted (which means they failed and tried something else) before the mainstream realized the power of gaming and the market appeared. Rajat identified an “innovation adoption curve” of new approaches which appears to be fairly predictable in retrospect, based on his company’s direct experience. It starts with a trend of successful implementation within the consumer market.  When it reaches what appears to be a sustainable success rate, it’s picked up by mainstream media, entertainment businesses and consumer communities a few years later. Ultimately, the idea makes its way into the enterprise and onto the corporate intranet.

He used the example of “social media” starting with the explosive growth of MySpace circa 2005/06 which provided evidence that social could drive meaningful engagement and revenue for business. That set the bar for every consumer facing website to add an aspect of social into their online features. But it required several more years before social was integrated at the enterprise level with platforms like Salesforce Chatter, Yammer, Socialcast and Rypple.

Bunchball bore the battle scars in discovering that a giant consumer role model must provide successful precedence before enterprise will buy into a trend, no matter what potential benefits are identified.  The learning curve must be ascended and the early adopters must be sacrificed to pave the way for widespread adoption of new techniques. The mainstream media has to write about it so business can grasp dramatic effects.  Fortunately, Rajat and Bunchball survived three years of “trying to move the needle by educating companies about the art of gamification.”  Recently, a Gartner report found that more than 70 percent of Global 2000 organizations will have at least one gamified application by 2014 – seven years after Bunchball’s first customer was knocking on their door asking for a gamification platform before it was even completed.

When asked about the positive side effects of increased gamification, Rajat answered, "Business owners realize that their customers aren't just passive recipients, but active participants with needs and desires for reward, status, achievement, competition and self-expression. And that by satisfying those needs, they can create happy, engaged customers while at the same time driving real business goals."

Rajat referenced Daniel Pink’s book, Drive: The Surprising Truth About What Motivates Us, which draws on research in psychology, economics and sociology.  Pink shows that intrinsic motivators are more powerful than external.  People prefer activities where they can pursue three things:

1. Autonomy: People want to have control over their work.
2. Mastery: People want to get better at what they do.
3. Purpose: People want to be part of something that is bigger than they are.

Rajat added that the ability to measure and visualize progress within a context is important to the game experience. He asked the audience the question, “Should you gamify anything?” The answer is “No.” He identified areas that make sense, but not every experience will lend itself to being gamified, nor is every situation appropriate just because it can be done.  An obvious example is providing incentives to sales organizations, where gamification has always been intrinsic, but not framed specifically as gamification. He provided three questions to think about whether it makes sense to gamify:

1. What is the core user experience you are trying to gamify?
2. What is meaningful to users?
3. What is good for my business?

The answers differ depending on the type of business, the stage in the sales process, the call to action, the KPIs and the measurement of success.  He suggested that WIIFM is the key qualifier to recognize and answer. “Whats In It For Me?” What is the intrinsic, core, compelling reason why users will want to engage?  What reaction will users have and what experience will users derive immediately and on many different subjective and subliminal levels?

Begin by thinking about specific results that could be produced:
1. Tracking individual users’ activities and assigning a score to each.
2. Providing a list of every user and score next to their name indicating how valuable and how much progress has been achieved.
3. Game mechanics that will drive those numbers (scores) achieved by users and attach value to specific activities.

Businesses quantify success by acquisition, activation and retention.  Rajat offered some concepts to drive user’s increased engagement within a site, product or service.

1. Reward users with points that they can accrue over time. For brands, points are a good way to get consumers to complete certain tasks. Brands can capitalize on this notion and use points to drive different behaviors within a site or application by using them as status indicators, allowing points to unlock access to content, or making them valid for virtual goods and gifting.

2. Provide milestones so they can achieve different levels with mastery. Businesses can use levels within their websites to regulate access to certain parts of a site or as a way to recognize reaching a milestone to honor frequent users and engagement.

3. Challenge users directly with competition to achieve scores. Configure challenges based on actions that you're tracking, and reward your users for reaching milestones with trophies, badges, and achievements. For example, a business could challenge users to beat a high score in an online game. If a user achieves the high score, they would be commended and receive a badge, which will attach to their profile.

4. Provide virtual goods, badges or rewards. Virtual goods are non-physical objects that can be purchased for use in online communities and/or games. They help a game economy become more effective over time. Users can purchase virtual goods like clothing or decorations to create an identity for their virtual self (avatar) while comparing and showing off with their friends. "The Real Housewives of Atlanta" gamified its site and now allows users to create their own avatars. Users have the ability to style their avatar with virtual goods -- the more they buy, the better their avatar looks.

5. Enable users to challenge each other beyond being challenged by the game. Once everyone has done the activity, the user with the highest score wins a reward, while the losers receive a consolation prize. Team competitions are also a possibility. For example, when Bravo gamified "Top Chef All-Stars" with the "Virtual Top Chef Game," users chose their favorite "chef'testant" and were broken up into teams accordingly. Team members were then able to simultaneously earn points for themselves and their team through challenges for a chance to win shared and individual prizes.

6. Provide leaderboards so users can measure their progress against others. Leaderboards are used to track and display desired actions, using competition to drive valuable behavior. If users know that scoring points could land them a spot at the top of the chart, they will engage more and work harder to earn points. They are motivated to see their name in lights!

7.  Recognize the reality of user fatigue over time.  Make sure the core experience is dynamic and evolving so it is constantly refreshing.  The pursuit is to keep users at all levels engaged in the game in a never ending process, continually adding new challenges and new content.

The complexity of implementing game mechanics depends on multiple factors, including a business's content, audience, goal, and the type of tactics it wants to use. Regardless of the level of complication, if a gaming program is well-executed, an organization can expect to see an increase in key metrics such as time spent on the site, page views, and return visits.



---Cindy F. Solomon is Founder and Co-host of the Global Product Management Talk, the weekly mini-product camp Socratic discussion of Product Management thought leaders and international product managers via Twitter and audio commentary. @prodmgmttalk http://www.prodmgmttalk.com 
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